France Inflation Rate Unexpectedly Slows

France’s annual inflation rate slowed to 0.3% in January 2026, the lowest since late 2020, down from 0.8% in December and below expectations of 0.6%, according to preliminary estimates. The deceleration was mainly driven by a decline in manufactured goods prices (-1.2% vs -0.4%), largely reflecting price cuts in clothing and footwear. The data collection period covered 18 days of winter sales, up from 13 days in January 2025. Service price inflation also eased (1.8% vs 2.1%), particularly in healthcare, as increases in doctors’ fees were more limited than last year. Energy prices fell at a faster pace (-7.8% vs -6.8%), while tobacco prices rose more slowly due to base effects (2.8% vs 4.1%). By contrast, food price inflation edged slightly higher (1.9% vs 1.7%). On a month-on-month basis, the CPI fell by 0.3%, reversing a 0.1% increase in December and exceeding expectations of a 0.1% decline. Considering the EU-harmonised CPI, prices rose 0.4% on the year and fell 0.4% on the month.

France’s annual inflation rate eased to 0.8% in December 2025, its lowest level in seven months, down from 0.9% in each of the previous two months and in line with the preliminary estimate. The modest slowdown was primarily driven by a sharper year-on-year decline in energy prices (-6.8% vs -4.6%). Service price inflation also moderated slightly (+2.1% vs +2.2%). In contrast, food price inflation accelerated (+1.7% vs +1.4%), while prices of manufactured goods fell at a less pronounced pace (-0.4% vs -0.6%). Tobacco prices continued to rise at an unchanged annual rate of +4.1%. Meanwhile, core inflation edged up to 1.1% from 1.0%. On a monthly basis, consumer prices increased by 0.1%, rebounding from a 0.2% decline in November. In EU-harmonised terms, inflation slowed to 0.7% year on year, while prices rose by 0.1% month-over-month, in line with the initial reading.

France’s annual inflation rate fell to 0.8% in December 2025, its lowest level in seven months, down from 0.9% in each of the previous two months and below expectations of 0.9%, according to preliminary estimates. The easing in inflation was mainly driven by a sharper decline in energy prices (-6.8% vs -4.6%), particularly for petroleum products. By contrast, food price inflation accelerated (1.7% vs 1.4%), largely reflecting higher prices for fresh products. Prices of manufactured goods continued to decline, albeit at a slower pace (-0.4% vs -0.6%), while inflation in services (2.2%) and tobacco (4.1%) remained unchanged. On a month-on-month basis, consumer prices edged up by 0.1% after a 0.2% decline in November, undershooting expectations of a 0.2% increase. The rise was driven by a seasonal rebound in service prices, particularly in transport. In EU-harmonised terms, inflation fell to 0.7% year on year, below forecasts of 0.8%, while prices rose by 0.1% month-over-month.